The developer, Abu Dhabi’s largest by market capitalization,
is expected to re-finance 3 billion dirhams of debt by year-end, the bank said.
“We are skeptical about the terms of a new financing
solution,” it said.
“Aldar could surprise on the upside if it received an
explicit sovereign-guaranteed issuance in the current easier credit market.
Issue size would be critical to share price performance.
“Uncertainty remains about the government willingness to
carry market risk,” the bank added, maintaining its underperform rating for Aldar.
The developer’s shares have fallen 51 percent since March
28, driven by fears that minority investors will suffer if state support proves
dilutive, with last week’s resignation of its chief executive fueling negative
sentiment around the stock.
Aldar is forecast to report a third-quarter loss of 231
million dirhams ($62.89 million), in what would be its fourth consecutive
quarterly loss, according to analysts in a Reuters poll.
Investment bank EFG-Hermes estimates Aldar has 14 dirhams
billion of debt maturing in 2011 and faces a funding gap of about 6.1 billion
dirhams until the end of next year.
Abu Dhabi house prices have fallen 45 percent since 2008
peaks and will decline a further 20 percent, a Reuters poll in October showed.
